Brexit ruling: the conduit pipe and the cliff edge

On 24 January 2017, the Supreme Court handed down its judgment that primary legislation was required before ministers could give notice of the UK's intention to leave the EU under Article 50 of the Treaty on European Union. The government has since laid before Parliament the European Union (Notification of Withdrawal) Bill.

Zahra Al-Rikabi, Brick Court Chambers

On 24 January 2017, the Supreme Court handed down its judgment in R (on the application of Miller and another) v Secretary of State for Exiting the European Union, the majority holding that primary legislation was required before ministers could give notice of the UK's intention to leave the EU under Article 50 of the Treaty on European Union (Article 50) (the notice) ([2017] UKSC 5).

The government has since laid before Parliament the European Union (Notification of Withdrawal) Bill (the Bill).

Supreme Court decision

The court considered two key questions:

  • Whether primary legislation was required before ministers could give the notice.

  • Whether the consent of the devolved legislatures was required before that primary legislation could be enacted.

Primary legislation required. The court was concerned with the process of giving the notice as a matter of domestic law. The court proceeded under the premise that, once given, the notice is irreversible, and the two-year period referred to in Article 50(3) begins to run with the consequence that the EU treaties cease to apply once it expires, regardless of whether agreement about the terms of the UK's withdrawal has been reached, unless all EU member states consent to an extension of time, often referred to as falling off the cliff edge (see box "Article 50").

A number of constitutional principles underpin the judgments of the majority and the minority: both agreed that Parliamentary sovereignty is a fundamental principle of the UK constitution and both accepted that the conduct of foreign relations, including the ratification of treaties, falls within the prerogative powers of the Crown. In addition, both agreed that the Royal prerogative does not extend to altering the law or conferring rights on individuals or depriving individuals of their rights under domestic law without the intervention of Parliament.

The judgment of both the majority and the minority turned on the construction of section 2(1) of the European Communities Act 1972 (1972 Act) (section 2(1)), which is the mechanism by which EU law is given effect in UK law.

The key to the majority judgment is the conclusion that the 1972 Act effectively constitutes EU law as a new, independent and overriding source of domestic law. Therefore, using the Royal prerogative to withdraw from the EU would constitute as significant a constitutional change as that which occurred when EU law was first incorporated into domestic law by the 1972 Act. As a result, the majority found that it would be inconsistent with a long-standing and fundamental principle for such a far-reaching change to the UK's constitutional arrangements to be brought about by ministerial decision alone.

The minority analysis was that section 2(1) is inherently conditional on the EU treaties applying to the UK, and therefore on the UK's membership of the EU, but does not manifest any intention in respect of the UK's membership of the EU. So the 1972 Act simply creates a scheme under which the effect given to EU law in domestic law reflects the UK's international obligations under the EU treaties. Given that section 2(1) is silent on the question of whether prerogative powers may be used to withdraw from the treaties, it does not alter the usual principle that the conduct of foreign relations is a matter falling within the prerogative powers of the Crown.

The majority and the minority also disagreed as to whether service of the notice would remove some existing rights of UK residents. While the minority did not dispute that leaving the EU would affect the rights enjoyed by UK residents granted through EU law, it held that these rights were granted by Parliament on a conditional basis. Again, this stems from the minority's reading of section 2(1) as being indifferent as to the UK's membership of the EU.

A key point of divergence was the relevance of ministerial accountability to Parliament. The majority held that this is no answer to the absence of the power to give the notice and, further, that this was insufficient given the irreversible nature of giving the notice. In contrast, the minority questioned how a mere requirement for statutory authority for the notice would do anything to safeguard individual interests likely to be affected by withdrawal or to advance the process of Parliamentary scrutiny, which will ultimately be critical to protecting those interests.

Consent of devolved legislatures. The court was asked to consider whether the consent of each of the devolved legislatures was required before primary legislation could be passed to authorise the giving of the notice.

In each of the devolution settlements, the UK Parliament has preserved its right to legislate on matters which are within the competence of the devolved legislatures, but this has been constrained, in practice, by the principle that that the UK Parliament would not normally legislate on devolved matters except with the agreement of the devolved legislature (the Sewel Convention).

The court unanimously held that the courts cannot enforce a political convention and therefore there is no legal requirement for the devolved legislatures to consent to primary legislation to authorise the giving of the notice.

Further possible implications

There has been some speculation as to whether Miller would have an impact on the government's ability to invoke Article 127 of the EEA Agreement (Article 127), which allows a member to withdraw by providing at least 12 months' written notice to the other members, without further recourse to Parliament.

Wider application of the judgment is unlikely because the majority placed particular emphasis on the conduit pipe metaphor in its analysis of the effect of section 2(1). This is illustrated in the rejection of the Secretary of State's submission that bilateral double taxation treaties provide an analogous context to section 2(1). The majority rejected this on the premise that those arrangements took effect through a specific order which had to be approved by Parliament and so the conduit pipe metaphor which applies to the 1972 Act in relation to EU law was not appropriate.

In R (on the application of Yalland) v Secretary of State for Exiting the European Union, a number of applicants applied for judicial review challenging the government's apparent decision to leave the EEA and consequently the single market without an Act of Parliament and without triggering Article 127. On 3 February 2017, the High Court refused permission on the basis that the application is premature as no decision had yet been made to leave the EEA.

Impact on the exit process

The Bill was introduced in Parliament on 26 January 2017 and does no more than confer on the Prime Minister a power to notify, under Article 50, the UK's intention to withdraw from the EU. On 2 February 2017, the government also published a White Paper setting out the basis for 12 priorities previously highlighted by the Prime Minister on 17 January 2017, which are said to guide the government in its negotiations with the EU.

Despite the government rejecting all proposed amendments, the Bill was approved by the House of Commons on 8 February 2017.

At the time of writing, the Bill has had its first reading in the House of Lords. It is expected that the government will face stronger resistance in the House of Lords, and suggested amendments include a second referendum in relation to the final deal that is negotiated with the EU, a Parliamentary vote on the final deal before its approval by the EU institutions, and an emphasis on ensuring openness at the border between the Republic of Ireland and Northern Ireland. It is not clear at the time of writing which, if any, of the tabled amendments will gain traction.

The passage of the Bill in its current form reinforces Lord Carnwath's view that the mere insistence on primary legislation to authorise the government to give the notice does not guarantee Parliamentary scrutiny of the direction of negotiations with the EU, nor of the ultimate content of any agreement. But Parliament could have opted to proceed in a different manner, or it could have refused to authorise the Prime Minister to notify at all.

There will be Parliamentary debate, in the context of the Great Repeal Bill, about which rights currently conferred by the EU ought to survive the UK's exit from the EU. However, the survival of rights that depend on the co-operation of other member states, such as the passporting rights that are important to UK financial institutions, will be entirely dependent on the deal to be negotiated by the government (see Opinion "Financial services post-Brexit: possible cross-border models", this issue). In that regard, once the notice is given, we appear to be entirely in the government's hands as we roll towards the cliff edge.

Zahra Al-Rikabi is a barrister at Brick Court Chambers.

 

Article 50

The process for withdrawing from the EU treaties is set out in Article 50 of the Treaty on European Union, which includes the following provisions:

  • Any EU member state may decide to withdraw from the EU in accordance with its own constitutional requirements (Article 50(1)).

  • A member state which decides to withdraw must notify the European Council of its intention (Article 50(2)).

  • The treaties will cease to apply to the member state in question from the date of entry into force of the withdrawal agreement or, failing that, two years after the notification referred to in Article 50(2), unless the European Council, in agreement with the member state concerned, unanimously decides to extend this period (Article 50(3)).


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